What Is the Reliability of a Product with a Failure

question 42

Multiple Choice

What is the reliability of a product with a failure rate of 0.015 per operating hour and a useful life of 250 hours?

• A) 0.14
• B) 0.12
• C) 0.88
• D) 0.98
• E) 0.02

---

Definitions:

Capital Investment

Funds invested in a business with the expectation of future benefits, such as the purchase of equipment or property.

Qualitative Characteristic

Attributes that describe the non-quantifiable aspects of financial information, emphasizing the quality and utility of reported data.

Net Present Value

The difference between the present value of cash inflows and outflows over a period of time, used in capital budgeting to assess the profitability of an investment or project.

Residual Value

The estimated value of a fixed asset at the end of its useful life, crucial for calculating depreciation.